I know Toady has some long long term goals siding this and there is an old thread with some similar ideas in
http://www.bay12games.com/cgi-local/ultimatebb.cgi?ubb=get_topic&f=5&t=001101 but I just had come up with this and thought it was so awesome I have to register and post.
Imagine dwarves could invent stuff, similar to artifact making, but much more rare. Like, you may get one or two inventions per an average fortress' lifetime, if you're lucky. Dwarf goes fey, claims an alchemists shop and makes black powder or claims mechanics and makes some new cadget. All new inventions will start leaving their mark on dwarves' everyday life and will sometimes unlock new workshops and items you can build. The inventions will spread once diplomats get to see them and you sell them to caravans. Other civs will also be able to do these advancements on their own.
Any dwarf could invent stuff, but dwarves with certain skills and professions have a bigger chance of inventing something improving their own profession. Philosophers could have a slightly bigger chance making inventions overall, giving a possibility to a dwarven Leonardo da Vinci.
After a long time and some possible new fortresses, dwarves could invent science and you could start making libraries (at least after inventing press), maybe even universities, with dwarven scientists doing research. They could be a new form of nobles, requiring study rooms and demanding some weird materials and items. If you fail to meet their requirements, they wouldn't punish any dwarf, just go melancholy and maybe kill themselves. You could also order the scientists to study something specific, like agriculture, or metals, leading to some kind of tech tree, but that'll available then, not from the start.
Some bigger breakthroughs could be inventing medicine, leading to hospitals and quicker recovery from wounds, steam machines, leading to, say, steam- and dwarf-powered gigantic mechas fighting off a horde of goblins and a dragon, and guns, first big black-powder cannons, then flintlocks and the like, finally handguns and rifles. Flying machines, horseless carts. Electricity. You could even get to see a scientist demanding for a box and a cat.
The technological level between races would usually be about the same at first, but there could be some high-tech elves in some games, or goblins from space. Too much of a technological difference would usually make for an imbalanced game, and the superior races could wipe out others already in world generation.
All the advancements would come very slowly, it would not be possible to get it all in one fortress' lifetime, unless the fort is extremely long-lived. It would be much more interesting to go about as an adventurer between fortresses too, to see how the world is changing.
Sorry if this all seems like old and not worth discussing. Ignore this if you want.